The government has said that from April 1, the Unified Pension Scheme (UPS) will be launched as an option against the current National Pension System (NPS). This scheme is designed to provide better pension payment to government employees’ retirement, heeding the long-standing demand for a better pension system.
The UPS will be a new pension plan that will be available to central government employees who are currently enrolled in the NPS and are eligible to join this new pension plan. The UPS was brought in after the government agreed to revive the Old Pension Scheme (OPS) that guaranteed all retirees got 50 per cent of their last-drawn salary as pension.
In the new scheme, the employee will have to contribute 10% of the basic salary and DA and the government will contribute 18.5% as against 14% earlier and there will be an additional 8.5% contribution towards a separate pooled fund, thus increasing the overall pension benefits.
All central government employees will be eligible for a full pension if they have served the government for 25 years. Pension will be paid proportionately for the period between 10 and 25 years of service. The family of the deceased employee will be eligible for 60% of the pension amount. NPS retirees who have retired before the UPS effective date will also get arrears with interest. Also, voluntary retirees above the age of 25 years will be entitled to receive pension from the age of their intended retirement.
